"Buckle up," was the advice issued Thursday to Apple investors by J.P. Morgan, as the firm expects Apple's stock to soar to new heights in the next year and a half based on rapid growth of both the iPhone and iPad.

Apple was added to J.P. Morgan's Analyst Focus List, and increased the price target for the "overweight" stock to $390 by December of 2011. Analyst Mark Moskowitz said it is the growth of the iPhone and iPad, combined with untapped international opportunities for the Mac, that will send Apple's stock soaring to new heights.

"We do not expect our latest round of upward revisions to be the last," he wrote. "Overall, our estimate revisions point to top and bottom-line growth far exceeding 20% over the next two years, which we think requires a re-rating of the stock's valuation principles."

For starters, Moskowitz believes the iPhone 4 will finally push Apple past the 10-million-per-quarter threshold. He believes Apple will eclipse that number in shipments for the iPhone in September 2010. Previously, it was expected to reach that milestone in March 2011.

For comparison, last quarter Apple sold 8.75 million iPhones, representing its best quarter ever for handset sales.

The numbers don't even include the prospect of a Verizon-compatible CDMA iPhone, rumors of which have picked up again this week, following a new report from Bloomberg claiming the device will arrive in January 2011. Moskowitz said conversations with industry contacts have indicated that a Verizon iPhone could launch next year at the earliest, but J.P. Morgan has opted to take a "conservative view."

"For Verizon, we think the issue is still over the subsidy," he said. "If that is not the issue, it could be that Verizon wants to build out its 4G LTE network, which is still in the early stages. On this topic, we do not expect the major 28 cities in the U.S. to have full LTE capability with Verizon until mid-2011."

And iPad sales are "just getting started," the analyst believes, with "iPad mania" set to intensify during the back-to-school and holiday seasons. Previously, the firm did not expect the iPad to catch on with consumers until future models added more features. J.P. Morgan now believes Apple will sell 3.8 million iPads in the June quarter, and 21.5 million in Apple's 2011 fiscal year.

"We expect the iPad to be a top selling item in both the back-to-school and holiday seasons," he said. ""There will be competitive entries introduced in coming quarters, but we do not expect there to be much disruption. Similar to the iPhone, the iPad reflects Apple's ability to introduce unrivaled technology experiences for the consumer."

Finally, Moskowitz said that the Mac could have some "near-term bumps," with hype over the iPad having some impact on sales. J.P. Morgan has lowered its forecast for Mac sales in the current quarter to 3.05 million, down from 3.11 million. For fiscal 2011, totals were also lowered from 15.95 million to 15.59 million.

But the analyst said Apple still has great potential to grow the Mac overseas. Moskowitz said he believes in a matter of years, Apple should be able to increase its international market penetration. Even if Apple reaches a global market share just half of what it has in the U.S., the revenue opportunity is in the billions of dollars.

With the leak that Apple had by Gizmodo, the on stage troubles at WWDC and finally the fiasco of the Antenna, Proximity Sensor and the plethora of bugs in iOS4, the Consumer will become the skeptic and will prevent the stock from reaching $390

With the leak that Apple had by Gizmodo, the on stage troubles at WWDC and finally the fiasco of the Antenna, Proximity Sensor and the plethora of bugs in iOS4, the Consumer will become the skeptic and will prevent the stock from reaching $390

I see your but take exception to the gizmodo leak. How does that instill skepticism within consumers? It created so much good promotion and buzz than negative for Apple. I dunno, I don't really see a connection with the price of stock and this particular leak. Let me clarify... this particular leak. And the WWDC troubles had nothing to do with the phones performance... it was a wifi overload issue. Most consumers will look right past that, as its not really something they are concerned with. Developers were the main audience for that presentation. I dunno.. Not sitting here being a troll, just curious how that all connects.

I don't mean to be sceptic but how is the current lineup of product going to drive the
price up that high. I understand that the iPhone and ipad are growing revenue but stll it doesn't compute for me. Could some of that high price come from an expactation that in late 2011 early 2012 there maybe be fewer stronger performing companies?

I know some of you folks are pretty good at stock analasis could you tell me if I am off base.

*I forgot to add that while they are rolling out new stores internationally I find it highly unlikely that they will be opening enough new stores fast enough to make that big of increase revenues in that short of a time frame.

I don't mean to be sceptic but how is the current lineup of product going to drive the
price up that high. I understand that the iPhone and ipad are growing revenue but stll it doesn't compute for me. Could some of that high price come from an expactation that in late 2011 early 2012 there maybe be fewer stronger performing companies?

I know some of you folks are pretty good at stock analasis could you tell me if I am off base.

The formula they use for these projections is pretty straight-forward. They estimate earnings, which requires some best-guesses on sales and margins. Lots of available data makes this not so difficult. Then they estimate earnings multiples (P/E), which in large part is based on projected earnings growth rates (they say 20% or more, which is consistent with recent history). The projected stock price is the product of the two. The second number is the idea killer, though. In a market where optimism rules, multiples are going to be much higher throughout the market. If the market turns bear, multiples can be much lower. The P/E assumption here is the one to question, IMO.

I don't mean to be sceptic but how is the current lineup of product going to drive the
price up that high. I understand that the iPhone and ipad are growing revenue but stll it doesn't compute for me. Could some of that high price come from an expactation that in late 2011 early 2012 there maybe be fewer stronger performing companies?

I know some of you folks are pretty good at stock analasis could you tell me if I am off base.

*I forgot to add that while they are rolling out new stores internationally I find it highly unlikely that they will be opening enough new stores fast enough to make that big of increase revenues in that short of a time frame.

JP Morgan and the big brokers have been know for doing pump-n-dump scams. Put bluntly, that's the only role these stock institutes do now. Get the price up and get real people to invest real money then the big movers get out before the bubble bursts. Like the dot com era...

With the leak that Apple had by Gizmodo, the on stage troubles at WWDC and finally the fiasco of the Antenna, Proximity Sensor and the plethora of bugs in iOS4, the Consumer will become the skeptic and will prevent the stock from reaching $390

Mmmm.. I remember someone telling me the same thing about the $200 barrier

Not sure what you are implying. AAPL first broke $200 in December 2007, IIRC. That was before the recession hit, as you may recall. The stock fell by 60% after that, and took nearly two years to get back to $200 due to the overwhelming pessimism of investors.

Not sure what you are implying. AAPL first broke $200 in December 2007, IIRC. That was before the recession hit, as you may recall. The stock fell by 60% after that, and took nearly two years to get back to $200 due to the overwhelming pessimism of investors.

I remember it well, Dr. Millmoss. My girlfriend was so impressed with all my Apple gear (iPhones, laptop, iMac, iPods, etc.) and knowledge of Apple, she bought 5 shares at $186 right before the recession only to watch it tank.

With the leak that Apple had by Gizmodo, the on stage troubles at WWDC and finally the fiasco of the Antenna, Proximity Sensor and the plethora of bugs in iOS4, the Consumer will become the skeptic and will prevent the stock from reaching $390

Not sure what you are implying. AAPL first broke $200 in December 2007, IIRC. That was before the recession hit, as you may recall. The stock fell by 60% after that, and took nearly two years to get back to $200 due to the overwhelming pessimism of investors.

Wow! 2 years to climb well over 100%! That _is_ overwhelming pessimism!? \

Seriously, who else can match Apple for product innovation? Who else can create revenue and margin like they can?

They sold 3m devices in the first 60 days, all at a price of at least $500 gross, in a category that did not even exist before, with estimated gross margin of about 50%. (isuppli cost estimate). In other words, $1.5 billion of new gross revenue, and $750 million of new gross margin! in 60 days! Are you kidding me! On an entirely new product segment! Show me another company that can do that.

They then proceeded to sell 1.7m iphone 4's in the first 3 days! Gross revenue at at least $400 per unit (including the ATT contribution) , gross margin also at least 50% (again using isuppli component cost). So in 3 days that is $0.7B gross revenue and $0.35B gross margin. Wow!

So, clearly the market is inefficient and stock price does not progress in a linear fashion (random walk, anyone?). Clearly a falling tide drops all boats...market doesn't look so good in general, all that is true. Today. But if you were looking for a home for your equity investment, who are you going to bet on? When you can get nearly zero on cash, and no more than 5% on BB+ corporate bonds?

Seriously, let's see how the economy plays out. In the current conditions, I don't see such a bullish case being made for any stock.

Yes, but you forget how Apple performed through the depths of the recession. Now that we're looking towards recovery, you somehow think they'll perform worse? This stock was recession-proof. Blowout quarter after blowout quarter.

Not sure what you are implying. AAPL first broke $200 in December 2007, IIRC. That was before the recession hit, as you may recall. The stock fell by 60% after that, and took nearly two years to get back to $200 due to the overwhelming pessimism of investors.

Actually, that drop was mostly related to Steve's health. Overall, AAPL greatly outperformed the market. Apple benefits from a flight to quality every time.

Not sure what you are implying. AAPL first broke $200 in December 2007, IIRC. That was before the recession hit, as you may recall. The stock fell by 60% after that, and took nearly two years to get back to $200 due to the overwhelming pessimism of investors.

Apple is not immune to the swings of the larger market, as there is a herd-mentality that governs much of the market. The fundamental performance of the company has been flawless during this time, though. That's the sign to watch for, as it implies the stock will correct itself (upward, of course) once the jitters are shaken from the market.

Seriously, who else can match Apple for product innovation? Who else can create revenue and margin like they can?

They sold 3m devices in the first 60 days, all at a price of at least $500 gross, in a category that did not even exist before, with estimated gross margin of about 50%. (isuppli cost estimate). In other words, $1.5 billion of new gross revenue, and $750 million of new gross margin! in 60 days! Are you kidding me! On an entirely new product segment! Show me another company that can do that.

They then proceeded to sell 1.7m iphone 4's in the first 3 days! Gross revenue at at least $400 per unit (including the ATT contribution) , gross margin also at least 50% (again using isuppli component cost). So in 3 days that is $0.7B gross revenue and $0.35B gross margin. Wow!

That's all true, but the market also works on herd mentality and psychology. Apple's market cap is probably too high, but it doesn't matter because sometimes stock becomes its own currency, although that can also be a danger, as it was during the dot.com failures.

Is Apple really worth the combination of any two of the following?
HP, Toyota, Oracle, Intel, Citigroup, Merck, Novartis, Pfizer, Coke, Cisco.

And if Apple's stock does hit 300, it would be more like any three of the above, assuming they don't also rise in tandem.

(And I say this as a happy owner of Apple stock and with the price down a bit today, I might buy some more.)

On the other hand, we are becoming so used to "big numbers", I don't think we appreciate just what Apple has accomplished in the numbers you quote. The time it took all manufacturers combined to sell just one million units is as follows for these other technologies (data from the Yankee Group):

But having said that, I see dangers lurking. Apple's arrogance can really hurt the company as people are starting to not see Apple as the hip underdog, but more like Microsoft. It seems to be starting to make engineering mistakes which are probably driven by a lack of proper comprehensive testing, which I bet is not happening because of Apple's paranoia over product release leaks. But there's no point exerting such control over product leaks if the products are going to suffer because of it. (Was the phone not properly tested because it was secured to a table at Apple and therefore, never held in someone's hand?) If the antenna issue is really a big issue on the new phone, that's going to negatively impact the perception that Apple always executes brilliantly. And their unwillingness to help solve the issue by giving away a piece of plastic that probably costs them 20 cents to make is obnoxious.

Apple traditionally was always pushing a high-end experience, but now Jobs talks about how 720p video is "good enough" (in regards to the debate about Blu-ray inclusion) or how we're "holding the phone wrong." He seems to want to de-emphasize the traditional computer so that Apple can control the entire experience, including the type of apps we use and access to the file system.

I'm a lot less interested in Apple if it only wants to make appliances in the future and is willing to settle for lower quality in order to attract the masses. Apple created its own retail experience because it was unhappy how other retailers presented Apple products, but now some products will be sold in Wal-Mart? What does that do to Apple's image?

Mmmm.. I remember someone telling me the same thing about the $200 barrier

In all likelihood they're right. The economy is shaky right now and the stock market is quite nervous. AAPL has this potential (and the bugs and whatnot with iOS 4 and the iPhone 4 aren't going to change that), but not until the economy finds its footing again. And even then it assumes continued stellar performance from Apple going forward (not just doing as well as they are, but continued trampling of their previous exceptional performance).

The true measure of a man is how he treats someone that can do him absolutely no good. Samuel Johnson

That's all true, but the market also works on herd mentality and psychology. Apple's market cap is probably too high, but it doesn't matter because sometimes stock becomes its own currency, although that can also be a danger, as it was during the dot.com failures.

Is Apple really worth the combination of any two of the following?
HP, Toyota, Oracle, Intel, Citigroup, Merck, Novartis, Pfizer, Coke, Cisco.

Sure. This is pretty elementary. Apple trades at such a high value, and is projected so favorably, because they continually innovate and progress their company in such a way that it grows at a rate unheard of in most other big businesses. I could go into specifics (Toyota: cars tied strongly to economy, recent brake issues; Intel: relatively stagnant growth; Citigroup: banking/finances) but all it comes down to is an expectation that Apple will continue performing as they have in the past.

The true measure of a man is how he treats someone that can do him absolutely no good. Samuel Johnson

Sure. This is pretty elementary. Apple trades at such a high value, and is projected so favorably, because they continually innovate and progress their company in such a way that it grows at a rate unheard of in most other big businesses. I could go into specifics (Toyota: cars tied strongly to economy, recent brake issues; Intel: relatively stagnant growth; Citigroup: banking/finances) but all it comes down to is an expectation that Apple will continue performing as they have in the past.

all those car companies have 2 r to 40 yr pension plans to fund
they all have billion dollar debts
they have over paid workers who hate their jobs
they ship very heavy products that cost a fortune to ship

apple has no pension to fund like the size like car companies are sadled with
>>>in any case apple employee pension funds are fully funded by apple
apple pay no dividends
apple has 55 bn in the bank by 2012
apple has no debt
apple has no debt
minus the 42 bn right now from the share price and what is left .
then include 18 million macs a yr in sales
55 million phones a yr
32 millon ipods a yr in sales
every yr these number grow
ipad sale 10 milion a yr

factor imna 32% percent profit rate accross the board
apple use near slave labor in red china to keep it cost down
even after 30percent pay raises by foxcomm apple still will give some payment to those slave workers
imported from poor harbin area of china
apple factory workers have no union's or pension's
apple is 70 percent green and getting greener by the day
this in the future will be worth billions
with carbon cap and trade

most car companies suck .their stock is worthless
gm says so
at 65 cents a share gm warns you it has no value

Yes, but you forget how Apple performed through the depths of the recession. Now that we're looking towards recovery, you somehow think they'll perform worse? This stock was recession-proof. Blowout quarter after blowout quarter.

Actually he doesnt; he is worried about multiple erosion. Earnings growth only goes so far without PE expansion.

Where I sit (ignoring the 20% drop in my portfolio this week), I don't see the economic problems. I see continuing unemployment, but I also see a whole lot of people trying to hire, including myself. I see businesses starting up deferred capital expenditure just like we saw in 2004-2005. I see a single small economy in Europe having real economic stress, disproportionally impacting the exchange rate. I see all the ingredients for an artificial dip in the market by the folks who profit on volatility.

In AAPL, I see a stock with a dramatically smaller percentage of their customers in serious financial stress... and I keep buying!

That's all true, but the market also works on herd mentality and psychology. Apple's market cap is probably too high, but it doesn't matter because sometimes stock becomes its own currency, although that can also be a danger, as it was during the dot.com failures.

Is Apple really worth the combination of any two of the following?
HP, Toyota, Oracle, Intel, Citigroup, Merck, Novartis, Pfizer, Coke, Cisco.

And if Apple's stock does hit 300, it would be more like any three of the above, assuming they don't also rise in tandem.

(And I say this as a happy owner of Apple stock and with the price down a bit today, I might buy some more.)

On the other hand, we are becoming so used to "big numbers", I don't think we appreciate just what Apple has accomplished in the numbers you quote. The time it took all manufacturers combined to sell just one million units is as follows for these other technologies (data from the Yankee Group):

But having said that, I see dangers lurking. Apple's arrogance can really hurt the company as people are starting to not see Apple as the hip underdog, but more like Microsoft. It seems to be starting to make engineering mistakes which are probably driven by a lack of proper comprehensive testing, which I bet is not happening because of Apple's paranoia over product release leaks. But there's no point exerting such control over product leaks if the products are going to suffer because of it. (Was the phone not properly tested because it was secured to a table at Apple and therefore, never held in someone's hand?) If the antenna issue is really a big issue on the new phone, that's going to negatively impact the perception that Apple always executes brilliantly. And their unwillingness to help solve the issue by giving away a piece of plastic that probably costs them 20 cents to make is obnoxious.

Apple traditionally was always pushing a high-end experience, but now Jobs talks about how 720p video is "good enough" (in regards to the debate about Blu-ray inclusion) or how we're "holding the phone wrong." He seems to want to de-emphasize the traditional computer so that Apple can control the entire experience, including the type of apps we use and access to the file system.

I'm a lot less interested in Apple if it only wants to make appliances in the future and is willing to settle for lower quality in order to attract the masses. Apple created its own retail experience because it was unhappy how other retailers presented Apple products, but now some products will be sold in Wal-Mart? What does that do to Apple's image?

iffy post
some great facts
some good questions

most people cannot tell the diff bet 720p 1080p
its not that 720 p is good enough
its that the screen size needs certain levels
42 in or bigger needs 720 or higher
48 in or bigger need 1080p peridot

computer screens need far less for
its tiny real estate thana 90 in plasma
3D set
so bluray for apple as opposed to itunes HD is a non starter
apple HD rocks
blu ray should be free

Seriously, let's see how the economy plays out. In the current conditions, I don't see such a bullish case being made for any stock.

All analyst do is GUESS based on sales and earning, etc. The real question is the market could tank YET AGAIN - Double Dip (HOPE NOT!) but its looking bad right now. Earnings season should start and help give us a boost but don't it will hold onto any gains after the earnings season is over.

Jobs and Housing needs to be addressed - So we will all have Gov't HEALTH CARE but who will have a JOB??